On Monday, Sonos, Inc. (Nasdaq: SONO), in a filing with the Securities and Exchange Commission (SEC), revealed that Deirdre Findlay, Sonos Chief Commercial Officer, had resigned from her position with the company on February 19, 2025. This is yet another top executive, in this case, a top marketing position, to leave the company.
See more on this additional top executive departure from Sonos
I first told you about Deirdre Findlay back in October 2023 when she was part of an announcement of three “new” executives that then-CEO Patrick Spence announced in an effort to blunt the blow from rock star product guy Panos Panay (former Microsoft Chief Product Officer) announcing he would leave Sonos to join Amazon. However, Findlay wasn’t really new, she had joined the Sonos Board of Directors in 2020, the same time that Panay came on board with the company.
Findlay left the board to take an operating role with the company as its Chief Commercial Officer. In this role, she was placed in charge of go-to-market strategy and customer experience.
Another Victim of a ‘Purge’ at Sonos?
You might think that Findlay was just another victim of some kind of purge taking place at Sonos, which has seen the exits of CEO Patrick Spence, Chief Product Officer Maxime Bouvat-Merlin, and Global Chief Marketing Officer Jordan Saxemard. Certainly, we know that the first two on that list were terminated by the company. I am not sure about Saxemard, the circumstances surrounding that exit are not clear.
And of course, let’s not forget the company just terminated around another 200 employees, managers, and executives in its latest round of layoffs – a total dismissal of around 12% of its workforce.
This Time May Be Different
However, the case of Ms. Findlay appears to be a different story. According to the SEC filing, the company says that “Ms. Findlay is resigning for personal reasons and there were no disagreements between the Company and Ms. Findlay on any matters relating to the Company’s operations, policies or practices that led to her resignation.”
The day after Findlay resigned, the company says in the SEC filing, it entered into a “Transition Agreement” with her, in which Findlay will provide “consulting services, including advice on the Company’s marketing strategy…” until a final exit date of May 18, 2025. This often means that there was still some time left on her existing contract and the company wanted to replace that with a new agreement to tie up any loose ends between now and that ending period.
Is Sonos Paranoid?
The company notes that the transition agreement includes a standard “perpetual confidentiality provision” as well as a “mutual non-disparagement” clause as well as a “non-solicitation of employees, clients, and vendors” clause. While you may think that Sonos is being a little paranoid, it is not uncommon with public companies to have these types of provisions in contracts with exiting executives.
That being said, I have to admit that this news triggered a memory I had of a statement I had stumbled across in the company’s recent 10-Q earnings report filing. In the section “Management’s discussion and analysis of financial condition and results of operations,” Sonos took pains to describe all the steps they were taking to cut their costs and overhead expenses.
In a Time of Cost Cutting, One Expense Category Got an Extra Couple of Million Dollars Throw at It
They had been quite successful in reigning in G&A (General & Administrative) expenses, cutting them by 35.1%. But in one expense category – Research & Development – the company actually had to spend nearly $2 million more. This stood out as the company appeared to be trying to cut all expenses in all categories.
Was this extra millions spent on R&D because of exciting work on new products? Nope! Sonos needed to throw an extra couple of million dollars for increased “stock-based compensation expense” that it said was “related to retention of key personnel.” That’s right…the company is having to do what is at this point the hardest thing for them to do, throw more compensation to keep people on board.
Any extra compensation included as part of Findlay’s transition agreement was not revealed, other than to show that any stock awards that she is entitled to will still vest during this consulting period. The company will also cover the full cost of her COBRA costs for medical, dental, and vision insurance.
Then, There’s This
There actually has been a slew of Sonos announcements in the last few days. Likely, this is the company’s attempt to turn the tide of publicity to more positive topics after the news of its reorganization.
These latest announcements include: the board has authorized a “common stock repurchase program” of up to $150 million. These programs are popular with investors and can serve to reduce the stock “float” and help with certain stock-related metrics, as well as “returning capital to our shareholders.” The company has also announced it will participate in an upcoming Morgan Stanley investor conference.
To learn more about Sonos, visit sonos.com.
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